Correlation Between Embotelladora Andina and Energia Latina
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By analyzing existing cross correlation between Embotelladora Andina SA and Energia Latina SA, you can compare the effects of market volatilities on Embotelladora Andina and Energia Latina and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Embotelladora Andina with a short position of Energia Latina. Check out your portfolio center. Please also check ongoing floating volatility patterns of Embotelladora Andina and Energia Latina.
Diversification Opportunities for Embotelladora Andina and Energia Latina
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Embotelladora and Energia is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Embotelladora Andina SA and Energia Latina SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energia Latina SA and Embotelladora Andina is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Embotelladora Andina SA are associated (or correlated) with Energia Latina. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energia Latina SA has no effect on the direction of Embotelladora Andina i.e., Embotelladora Andina and Energia Latina go up and down completely randomly.
Pair Corralation between Embotelladora Andina and Energia Latina
Assuming the 90 days trading horizon Embotelladora Andina SA is expected to generate 588.48 times more return on investment than Energia Latina. However, Embotelladora Andina is 588.48 times more volatile than Energia Latina SA. It trades about 0.36 of its potential returns per unit of risk. Energia Latina SA is currently generating about -0.22 per unit of risk. If you would invest 245,060 in Embotelladora Andina SA on January 30, 2025 and sell it today you would earn a total of 54,710 from holding Embotelladora Andina SA or generate 22.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Embotelladora Andina SA vs. Energia Latina SA
Performance |
| Timeline |
| Embotelladora Andina |
| Energia Latina SA |
Embotelladora Andina and Energia Latina Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Embotelladora Andina and Energia Latina
The main advantage of trading using opposite Embotelladora Andina and Energia Latina positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Embotelladora Andina position performs unexpectedly, Energia Latina can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Energia Latina will offset losses from the drop in Energia Latina's long position.| Embotelladora Andina vs. Multiexport Foods SA | Embotelladora Andina vs. LATAM Airlines Group | Embotelladora Andina vs. Banco de Credito |
| Energia Latina vs. Aguas Andinas SA | Energia Latina vs. Parq Arauco | Energia Latina vs. Enel Generacin Chile | Energia Latina vs. Sociedad Matriz SAAM |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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